Correlation Between GREENWICH ASSET and CORNERSTONE INSURANCE

Can any of the company-specific risk be diversified away by investing in both GREENWICH ASSET and CORNERSTONE INSURANCE at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining GREENWICH ASSET and CORNERSTONE INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GREENWICH ASSET ETF and CORNERSTONE INSURANCE PLC, you can compare the effects of market volatilities on GREENWICH ASSET and CORNERSTONE INSURANCE and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in GREENWICH ASSET with a short position of CORNERSTONE INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GREENWICH ASSET and CORNERSTONE INSURANCE.

Diversification Opportunities for GREENWICH ASSET and CORNERSTONE INSURANCE

-0.45

Correlation Coefficient

GREENWICH ASSET  CORNERSTONE INSURANCE

Very good diversification

The 3 months correlation between GREENWICH and CORNERSTONE is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding GREENWICH ASSET ETF and CORNERSTONE INSURANCE PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CORNERSTONE INSURANCE PLC and GREENWICH ASSET is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on GREENWICH ASSET ETF are associated (or correlated) with CORNERSTONE INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CORNERSTONE INSURANCE PLC has no effect on the direction of GREENWICH ASSET i.e., GREENWICH ASSET and CORNERSTONE INSURANCE go up and down completely randomly.

Pair Corralation between GREENWICH ASSET and CORNERSTONE INSURANCE

Assuming the 90 days trading horizon GREENWICH ASSET ETF is expected to under-perform the CORNERSTONE INSURANCE. In addition to that, GREENWICH ASSET is 1.03 times more volatile than CORNERSTONE INSURANCE PLC. It trades about -0.17 of its total potential returns per unit of risk. CORNERSTONE INSURANCE PLC is currently generating about 0.1 per unit of volatility. If you would invest  264.00  in CORNERSTONE INSURANCE PLC on September 10, 2024 and sell it today you would earn a total of  56.00  from holding CORNERSTONE INSURANCE PLC or generate 21.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

GREENWICH ASSET ETF  vs.  CORNERSTONE INSURANCE PLC

GREENWICH ASSET ETF

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GREENWICH ASSET ETF has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Etf's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the fund shareholders.

CORNERSTONE INSURANCE PLC

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CORNERSTONE INSURANCE PLC are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, CORNERSTONE INSURANCE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GREENWICH ASSET and CORNERSTONE INSURANCE

The main advantage of trading using opposite GREENWICH ASSET and CORNERSTONE INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GREENWICH ASSET position performs unexpectedly, CORNERSTONE INSURANCE can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in CORNERSTONE INSURANCE will offset losses from the drop in CORNERSTONE INSURANCE's long position.

The idea behind GREENWICH ASSET ETF and CORNERSTONE INSURANCE PLC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

Check out your portfolio center.

Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.